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Mobile app Monetization - Freemium, Paid Apps, Advertisements

| Category: General    

The most important, you should make after you have developed an app, is deciding on its monetization strategy. Although apps are created for many different reasons, the potential to earn huge money always will in the top 3 reasons for developing an app.

Less than a decade of entering into this new industry, mobile app market place has seen many a number of monetization strategies adopted by various developers. And a few strategies have become strategies most likely to achieve success among consumers. If you are ready with your app and planning your hat into the ring, you should decide upon a strategy before entering into mobile app marketplace.


This is the king of currently available monetizing options. Through this, consumers get the app with basic functionality for free. Users who would like to use the app with its entirety should be ready to part way with some money. This option is actually win-win situation for the customers as well as the developer. Because the users get a look-in into the app before paying and will have the satisfaction that he knows what e is paying for. And as far as the developer is concerned, he is giving his premium service for money and by offering the app for free he creates a list prospective consumers, who can be turned in paid consumer, with further nudging.

Although this strategy has all these benefits, this strategy works only if this is used very intelligently. The challenge is on deciding what features to offer free and what feature to offer on upgradation. If you give very few features in the free version, users may not get a good feel for the app and it is unlikely to enjoy it enough to upgrade, or even to keep it on their devices. On the contrary if a developer gives too much away for free in a freemium app, even users who like the app may hesitate a little to shell out any money to buy the full version.

Paid Apps:-

This is the simplest of the monetization strategy, it works by charging users for the initial download of an app. Paid apps are generally (relatively) inexpensive, and can benefit consumers by providing full user experiences free of ads. This simply means the app is not for free and people should download the app from the app store by paying the charge. The key to success for these kinds of apps is the ability to showcase the value of the app along with with an app rating, preferably in the top 10. Apps which do a great job in this category should combine unique features with premium design, functionality and brand.

This business model is like a pay and play strategy. And it depends on your marketing team’s ability to convince users to buy the app. The plus point is that the app generates revenue from the first download but to the make the customers pay for the app is tough, because the space is already overcrowded with free apps. Statistics expose an interesting fact, that more than 90% of the paid apps are downloaded less than 500 times per day, it is because to the cost liability it has on the customer.


This is another way of monetizing your app. This works in the following way. The app is given for free, and the app ties up with many companies and while the consumer uses the app, these advertisements are shown in-between and the app generates revenue by this way. Since the is offered free, the number of downloads can swell easily. With the data collected from the users like the demography and gathering information about the users browsing pattern, specific advertisements are displayed for specific users thus enabling the advertising company to reach target audience and by the way app generating money.

In the other side, we need to understand, that these advertisements can also cause annoyance to the user, since it uses the same already jam-packed screen space. So we need to design the app with the business model in mind, if we plan to use this model.

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